corporate integrity agreement between hhs oig and synthes, inc

8/8/2019 Corporate Integrity Agreement between HHS OIG and Synthes, Inc.

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CORPORATE INTEGRITY AGREEMENTBETWEEN THE

OFFICE OF INSPECTOR GENERALOFTHE

DEPARTMENT OF HEALTH AND HUMAN SERVICESAND

SVNTHES, INC.

i. PREAMBLE Synthes, Inc. hereby enters into this Corporate Integrity Agreement (CIA) with the

Office of Inspector General (OlG) of the United States Department of Health and HumanServices (HHS) to promote compliance by Synthes, Inc. and its U.S. subsidiaries with thestatutes, regulations, and written directives of Medcare, Medicaid, and all other Federalhealth care programs (as defined in 42 U.S.c. I 320a-7b(f)) (Federal health careprogram requirements) and with the statutes, regulations, and written directives of theFood and Drug Administration (FDA requirements). Hereafter, Synthes, Inc. and its U.S.subsidiaries shall be referred to collectively as "Synthes." Contemporaneously with thisCIA, Synthes, Inc. is entering into a Settlement Agreement with the United States.

As referenced in the Settlement Agreement, Synthes, Inc. and a Synthes, Inc.subsidiary, Norian Corporation (Norian), agreed to plead guilty to certain criminalcharges. The guilty plea by Noiian w1l result in the mandatory exclusion of NorIanunder 42 U.S.c. 1320a-7(a)(3). In addition to its agreement in this CIA to undertakecertain obligations designed to promote compliance with Federal health care program andFDA requirements, Synthes also agrees to enter into a separate Divestiture Agreementwith 010 relating to the exclusion of Norian.H. TERM AND SCOPE OF THE CIA

A. The period of the compliance obligations assumed by Synthes under this CIAshall be five years from the effective date of this CIA, unless otheiwise specified. Theeffective date shall be the date by which Synthes is obligated to pay the SettlementAmount as set forth in the Settlement Agreement between Synthes and the United States(Effective Date). Each one-year period, beginning with the one-year period following theEffective Date, shaH be refelTed to as a "Reporting PerIod."Corporate Integrity AgreementSynihes, Inc.

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B. Sections VII, ix, X, and XI shall expire no later than 120 days after OIG's receipt of: (1) Synthes' final Annual Report; or (2) any additional materials submitted bySynthes pursuant to GIG's request, whichever is later.

C. The scope of this CIA shall be governed by the following definitions:i. "Covered Persons" includes:

a. all owners of Synthes who are natural persons (other than shareholders who: (1) have an ownership interest ofless than 5%;and (2) acquired the ownership interest through public trading);b. all officers and directors of Synthes;c. (1) except as carved out below in this Section 1I.C.I, all employees of Synthes who are based in the United States, and (2) allemployees of Synthes or of any foreign subsidiary of Synthes, Inc.who are based outside the United States and who haveresponsibilities for or perform Promotional and Product ServicesRelated Functions, Clinical Investigation Related Functions, IDE-Exempted investigation Related Functions or Reporting RelatedFunctions (as defined, respectively, in Sections ILC.4-7 belowY; andd. all contractors, subcontractors, agents, and other representatives ofSynthes who perform any Covered Functions on behalf of Syntheseither in the United States or with U.S.-based health carepractitioners (HCPs).

Notwithstanding the above, this term does not include: (a) part-time or perdiem employees, contractors, subcontractors, agents, and other persons whoare not reasonably expected to work more than 160 hours per year, exceptthat any such individuals shall become "Covered Persons" at the point whenthey work more than 160 hours during the calendar year; or (b) officers,I The Promotional and Product Services Related Funetons, Clinical Investigaton Related Functions. IDE-ExemptedInvestigation Related Functions and Reporting Related Functions shall be referred to collectively as the "CoveredFunctions."

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employees, contractors, subcontractors, agents, or other personnel engagedin manufacturing functions or involved with Synthes' veterinary products,so long as they do not (i) market, distribute, sell, or promote GovernmentReimbursed Products or (ii) have responsibilities for or perform any ottheCovered Functions.2. "Relevant Covered Persons" includes all Covered Persons who have responsibilities for or perform any of the Covered Functions.3. "Government Reimbursed Products" refers to all human products ofSynthes or any foreign subsidiaiy of Synthes, Inc. that are promoted orsold by Synthes or any foreign subsidiary of Synthes, Inc. in the UnitedStates and reimbursed by Federal health care programs.4. "Promotional and Product Services Related Functions" include: (a) thepromotion, marketing, advertising, and sale of Government ReimbursedProducts; (b) the development or dissemination of materials orinformation about, or the provision of services, training, or consumerpreference testing relating to Government Reimbursed Products; and (c)

the activities of the Professional Relations Department.

5. "Clinical Investigation Related Functions" include: organizing, coordinating, administering, providing training for, monitoring, and FDAreporting related to clinical investigations, subject registries, and otherresearch or studies involving the use of Government ReimbursedProducts or Synthes products that Synthes expects or intends willbecome Government Reimbursed Products in one or more humansubjects, as well as all relevant obligations under FDA's InvestigationalDevice Exemption regulations, 21 C.F.R. Part 812, Protection of HumanSubjects regulations, 45 C.F.R. Part 46 and 21 C.F.R. Part 50,Institutional Review Board regulations, 21 C.F.R. Part 56, and FinancialDisclosure by Clinical Investigator regulations, 21 C.F.R. Part 54.

6. "IDE-Exempted Investigation Related Functions" include: organizing,coordinating, administering, providing training for, and monitoringconsumer preference testing, market preference evaluations, testing ofmodifications, or testing of a combination of two or more devices in

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commercial distribution, or other such testing in one or more humansubjects involving Government Reimbursed Products or Synthes productsthat Synthes expects or intends will become Government ReimbursedProducts that are exempted from IDE regulation, including, but notlimited to those exempted under 21. C.F.R. 812.2.

7. "Reporting Related Functions" include: identifying, tracking, gathering,and compiling information and preparing reports for the purpose ofproviding information to the FDA concerning Government ReimbursedProducts or Synthes products that Synthes expects or intends willbecome Government Reimbursed Products. This includes reporting ofadverse events (including reports required under 21 U.S.c. 360i andthe Medical Device Reporting (MDR) regulation at 21 C.F.R. 803 andother reporting under FDA requirements, (including those required under21 C.F.R. 814.84)).

8. "Relevant Promotional and Product Services Covered Persons" includes all Covered Persons who have responsibilities for or performPromotional and Product Services Related Functions.

9. "Relevant Clincal Investigation Covered Persons" includes all CoveredPersons who have responsibilities for or perform Clinical InvestigationRelated Functions.

10. "IDE-Exempted Investigation Covered Persons" includes all CoveredPersons who have responsibilities for or perform IDE-ExemptedInvestigation Related Functions.1 i. "Relevant Reporting Covered Persons" includes all Covered Persons whohave responsibilities for or perform Reporting Related Functions.12. "Synthes Consultants" are employees of Synthes whose responsibilitiesinclude the provision of Promotional and Product Services RelatedFunctions within assigned geographic ten'tories within the United States,as well as those individuals who serve as Biomaterials Technical

Specialists.

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UI. CORPORATE INTEGRITY OBLIGATiONSPrior to the effective date, Synthes established a Compliance Program thatincludes the elements set forth below. Synthes shall maintain such a Compliance

Program throughout the term of this CIA:

A. Compliance Responsibilities of Ceitain Synthes Employees and the Board of Directors.1. ChiefComphance Officer. Prior to the Effective Date, Synthes

appointed an individual to serve as its Chief Compliance Officer and Synthes shallmaintain a Chief Compliance Officer for the tenn of the CIA. The Chief ComplianceOfficer shall be responsible for developing and implementing policies, procedures, andpractices designed to ensure compliance with the requirements set forth in this CIA andwith Federal health care program requirements and FDA requirements. The ChiefCompliance Officer shall be a member of senior management and shall report to theChief Executive Officer and to the Audit Committee of the Board. The ChiefCompliance Officer shall make periodic (at least quarterly) reports regarding compliancematters directly to the Audit Committee of the Board of Directors of Synthes and shall beauthorized to report on such matters to the Board of Directors at any time. The ChiefCompliance Officer shall not be, or be subordinate to, the General Counselor FinancialOfficer. The Chief Compliance Officer shall be responsible for monitoring the day-today compliance activities engaged in by Synthes as well as for any reporting obligationscreated under this CIA. Any job responsibilities of the Chief Compliance Officer notrelated to compliance functions shall be limited and must not interfere with the ChiefCompliance Officer's ability to perform the duties outlined in this CIA.

Synthes shall report to OIG, in writing, any changes in the identity or positiondescription of the Chief Compliance Officer, or any actions or changes that would affectthe Chief Compliance Officer's ability to perform the duties necessary to meet theobligations in this CIA, within 5 days after such a change.2. Compliance Committee. Piior to the Effective Date, Synthes appointed

a Compliance Committee, and Synthes shaH maintain the Compliance Committee duringthe CIA. The Compliance Committee shall, at a minimum, include the ChiefCompliance Officer and the members of senior management with responsibilities relevantto the requirements of this CIA, including the Chief Executive Officer, the Chiefthe term of


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Financial Officer, the Head of Global Operations, the Vice President of Global HumanResources, the Presidents of all of Synthes' business divisions, including Trauma, Spine,CMF, and Biomaterials, the General Counsel, the Vice President of Global Regulatoiyand Clinical Affairs (when such a position has been filled) and the Head of InternalAudit. The Chief Compliance Officer shall chair the Compliance Committee. TheCommittee and its individual members shall provide the support required for the ChiefCompliance Officer to maintain an effective corporate compliance progran1 for Synthes.This support shall include, but is not limited to: providing executive level guidance to theChief Compliance Officer on matters related to corporate ethics and compliance; actingas a body to which to escalate, discuss, and resolve compliance issues; providingresources and support within their individual areas of responsibility for complianceinitiative development, implementation and management; and monitoiing and supportingthe performance of Synthes' ethics and compliance-related initiatives, includingreviewing and addressing monitoring results and risk areas and overseeing internal andexternal audits and evaluations.

Synthes shall report to orG, in writing, any changes in the composition of theCompliance Committee, or any actions or changes that would affect the ComplianceCommittee's ability to perform the duties necessary to meet the obligations in this CIA,within i 5 days after such a change.

3. Board a/Directors Compliance Obligations. The Board of Directors(Board) shall be responsible for the review and oversight of matters related to compliancewith Federal health care program requirements, FDA requirements, and the obligations ofthis CIA. The Board shall, at a minimum, be responsible for the following:

a. Ensuring that the Audit Committee of the Board shall meet at least quarterly to review and oversee Synthes' Compliance Program, including but notlimited to the performance of Synthes' Certifying Employees (as defined below inSection 1lI.A.4) and Synthes' Chief Compliance Officer in the performance oftheirresponsibilities to ensure compliance with the terms of this CIA.b. The Board shall arrange for the performance of a review on the effectiveness of Synthes' Compliance Program (Compliance Program Review) by the

Compliance Expert (described below) for each Reporting Period of the CIA. The Boardshall review the Compliance Program Review Report (described below) of theCompliance Program Review as part of the review and assessment of Synthes'Corporate Integrity AgreementSynthes, Inc.

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Compliance Program. A copy of the Compliance Program Review Report shall beprovided to OIG in each Annual Report submitted by Synthes.C. The Board shall retain an independent individual or entity with expertise in compliance with Federal health care program and FDA requirements

(Compliance Expert). The Compliance Expert shall create a work plan for thethe Compliance ProgramReview, and prepare a wiitten report about the Compliance Program Review and theCompliance Program Review, oversee the perfonnance of results of the review. The written report (Compliance Program Review Report) shallinclude a description of the review and shall include recommendations with respect to theCompliance Program.

the CIA, the Board shall adopt a. For each Reporting Period of the Board, summarizing its review andoversight of Synthes' compliance with Federal health care program requirements, FDAresolution, signed by each individual member of

requirements, and the obligations of this CIA.

At minimum, the resolution shall include the following language:"The Board of Directors has made a reasonable inquiry into the operations ofthe Certifying Employees

and the Chief Compliance Officer in the peifonnance of their responsibilities to ensurecompliance with the tenus of this CIA. In addition, the Board has retained a ComplianceExpett with expertise in compliance with the Federal health care program and FDArequirements to support the Board's responsibilities. The Board also has arranged for the

Synthes' Compliance Program, including the perfonnance of

the Compliance Program Review, includingthe Compliance Program Review Report. Based on all of these steps, the Board hasconcluded that, to the best of its knowledge, Synthes has implemented an effectiveperformance of, and reviewed the results of

Compliance Program to meet Federal health care program requirements, FDArequirements, and the obligations of the CIA."

If the Board is unable to provide such a conclusion in the resolution, the Boardshall include in the resolution a written explanation of the reasons why it is unable toprovide the conclusion and the steps it is taking to implement an effective ComplianceProgram at Synthes.

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Synthes shall report to orG, in writing, any changes in the composition of theBoard, or any actions or changes that would affect the Board's ability to perform theduties ilecessaiy to meet the obligations in this CIA, within i 5 days after such a change.4. Management Accountability and Certifications: In addition to theresponsibilities set forth in this CIA for all Covered Persons, certain Synthes employees

("Certifying Employees") are specifically expected to manage, monitor and overseeactivities within their areas of authority, including implementation of this CIA, and shallannually certify that the applicable Synthes component is compliant with Federal healthcare program requirements, FDA requirements, and the obligations oftls CIA. TheseCertifying Employees shall include, at a minimum, the following: Synthes' ChietFinancial Officer, Head of Global Operations, Vice-President ofGlobal Human Resources, the Presidents of all Synthes' business divisions and regions,including Trauma, Spine, CMF, and Bomaterials, Senior Vice-President - Education,and the Vice-President of Global Regulatory and Clinical Affairs (when such position hasbeen filled).

Executive Officer, Chief

For each Repoliing Period, each Certifying Employee shall sign a certification thatstates:"I have been trained on and understand the compliance requirements andresponsibilities as they relate to (department or functional area), an area under mysupervision. My job responsibilities include ensuring compliance with regard to themy knowledge,_ (insert name otthe department or functional area.) To the best of except as otherwise described herein, the (insert name of department orfunctional area) of Synthes is in compliance with all applicable Federal health careprogram requirements, FDA requirements, and the obligations of the CIA."B. Written Standards.

1. Code afConduct. To the extent not already accomplished, within 90days after the Effective Date, Synthes shall develop, implement, and distribute a writtenCode of Conduct to all Covered Persons. Sy'l1thes shall make the promotion of, andadherence to, the Code of Conduct an element in evaluating the performance of allemployees.

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TIie Code of Conduct shall, at a minimum, set forth the following:a. Synthes' commitment to full compliance with all Federal healthcare program and FDA requirements, including its commitment tomarket, sell, promote, research, develop, provide information about,and advertise its products in accordance with Federal health programrequirements and FDA requirements;b. Synthes' requirement that all of its Covered Persons shall beexpected to comply with all Federal health care program and FDArequirements and with Synthes' own Policies and Procedures asimplemented pursuant to Section III.B (including the requirements ofthis CIA);c. the requirement that all of Synthes' Covered Persons shall be expected to report to the Chief Compliance Officer, or otherappropriate individual designated by Synthes, suspected violations ofany Federal health care program and FDA requirements or ofSynthes' own Policies and Procedures; andd. the right of all individuals to use the Disclosure Programdescribed in Section lItE, and Synthes' commitment tononretalation and to maintain, as appropriate, confidentiality andanonymity with respect to such disclosures.

To the extent not already accomplished, within 120 days after the Effective Date,each Covered Person shall certify, in writing or electronically, that he or she has received,read, understood, and shall abide by Synthes' Code of Conduct. New Covered Personssha.ll receive the Code of Conduct and shall complete the required certification within 30days after becoming a Covered Person (or 60 days if the Covered Person is based outsidethe CoveredPerson is based outside the United States), whichever is later.the United States) or within 120 days after the Effective Date (or 150 days if

Synthes shall periodically review the Code of Conduct to determine if revisionsare appropriate and shall make any necessary revisions based on such review. Anyrevised Code of Conduct shall be distributed within 30 days after any revisions arefinalized. Each Covered Person shall certify, in writing, that he or she has received, read,Corporate Integrity AgreementSynlhes, Ine.

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understood, and shall abide by the revised Code of Conduct within 30 days after thedistribution of the revised Code of Conduct (or 60 days if the Covered Person is basedoutside the United States).within

120 days after the Effective Date, Synthes shall implement written Policies and2. Policies and Procedures. To the extent not already completed,

Procedures regarding the operation of the Compliance Program and Synthes' compliancewith Federal health care program and FDA requirements (Policies and Procedures). At aminimum, the Policies and Procedures address the following:a. the subjects relating to the Code of Conduct identified in Sectionm.B.1;b. appropriate ways to conduct the Covered Functions in compliance with all applicable Federal healthcare progranirequirements, including, but not limited to the Federal anti-kickback statute (codified at 42 U.S.c. 1320a-7b), and the

Act (codified at 31 U.S.c. 3729-3733);alse Claims

c. appropriate ways to conduct Promotional and Product Services Related Functions and Clinical Investigation Related Functions incompliance with all applicable FDA requirements including therequirements applicable to investigational devices under 2 iC.F.R. 812,7;

d. appropriate ways to conduct IDE-Exempted Investigation RelatedFunctions in compliance with all applicable FDA requirementsincluding, but not limited to the requirements goveminginvestigational device exemptions under 21 C.F.R. 812.2 whichbar the use of IDE-Exempted Investigations to gather safety orefficacy data or in cases where there is a risk of patient harm;e. the appropriate manner in which to conduct Repoiting RelatedFunctions in compliance with all applicable FDA requirements;

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f. the protection of human subjects, as required by 45 C.F.R. Part46 and 21 C.F.R. Parts 50 and 56, and financial disclosure, asrequired by 21 C.F.R. Part 54;g. systems, processes, policies and procedures for ensuring that all devices S'ynthes introduces or causes to be introduced intointerstate commerce within the United States are the subject of:

(1) an FDA-approved pre-market approval application, under 21U.S.c. 360e(a)(2) and 21 C.F.R. Part 814; (2) a "51O(k)clearance" by FDA for marketing because it is found to besubstantially equivalent to an appropriate, legally marketeddevice, under 21 U.S.C. 360c and 360(k) and 21 C.F.R. Part807 -- Subpart E; (3) an investigational device exemption under21 U.S.c. 360j(g), for the investigational use ofa devi.ce onhumans; or (4) an exemption for certain devices as set forth in 21U.S.c. 360(1);

h. the materials and inforniation concerning GovernmentReimbursed Products, medical conditions, or medical indicationsthat may be distributed by Synthes Consultants or other Synthespersonnel, and the manner in which Synthes personnel respond torequests for information about non-FDA approved or cleared("off-label") uses of Synthes' products;

1. the materials and information concerning GovernmentReimbursed Products, medical conditions, or medical indicationsthat Synthes may distribute through a medical servicesdepartment (if and when such a department is established). In theevent that Synthes elects to change its policies and providewritten materials in response to requests for information aboutnon-FDA approved or cleared ("off-label") uses of Synthes'products, the Policies and Procedures shall address themechanisms through, and manner in which, Synthes will acceptand respond to such requests (e.g., through a medical servicesdepartment), the form and content of information disseminatedby Synthes in response to such requests, and the internal reviewprocess for the information disseminated. The Policies and

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Procedures shall further require that Synthes develop a databaseto track such requests. This database shall be refen-ed to as the"Inquiries Database."The Inquiries Database shall include the following items ofinfonnation for each unique inquiy (Inquiiy) received forinfonnation about off-label uses of Synthes' products: l) date ofInquiry; 2) form ofInquiry (e.g.. fax, phone, etc.); 3) name of therequesting health care professional (HCP) or health careinstitution (HCI); 4) nature and topic of request (including exactlanguage of the Inquiry if made in writing); 5) an evaluation ofwhether the Inquiry relates to information about an off-labelindication for the product; 6) nature/form of the response fromSynthes (including a record of the materials provided to the HCPor HCI in response to the request); 7) the name of the Synthesrepresentative who called on or interacted with the HCP or HCI;and S) the status and findings of any follow-up review conductedby Synthes in situations in which it appears that the Inquiry mayhave related to improper off-label promotion;

J. if a physician determines that he or she will use a Synthes product for a non-FDA approved or cleared ("off-label") use, thetechnical assistance about the product that a Synthes employeein the United States may provide during the physician's use of

the product in a surgical setting;k. consultant or other fee-for-service arrangements entered into with HCPs or HCIs (including, but not limited to, market preference

evaluations, training programs, speaker programs, advisoryboards, or any other fmancial relationship with an HCP or HCl)and all events and expenses relating to such engagements orarrangements. These Policies and Procedures shall be designedto ensure that the arrangements and related events are used forlegitimate and lawful purposes in accordance with applicableFederal health care program and FDA requirements. The Policiesand Procedures shall include requirements about the content andcircumstances of such arrangements and events;


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1. sponsorship or funding of grants (including educational grants) orcharitable contributions. These Policies and Procedures shall bedesigned to ensure that S ynthes' funding and/or sponsorshipcomplies with all applicable Federal health care program andFDA requirements;

m. funding of, or participation in, educational or training activitiesfor HCPs or HClsbased in the United States. These Policies andProcedures shall be designed to ensure that Synthes' fundingand/or sponsorship of such activities satisfies all applicableFederal health care program and FDA requirements;

n. review of all promotional and other materials and information, including technique guides, containing claims or informationabout Government Reimbursed Products intended to bedisseminated outside of Synthes within the United States by or onbehalf ofSynthes, by legal, regulatory, and other relevantpersonnel in a manner designed to ensure that legal, medical,and, regulatoiy concerns are properly addressed during Synthes'review and approval process and are elevated when appropriate,The Policies and Procedures shall be designed to ensure that suchmaterials and information, when finally approved, comply withall applicable Federal health care program and FDArequirements;

o. sponsorship, funding of, and disclosures relating to research anddevelopment-related activities (including clinical trials, testmarkets, market research, and authorship of articles and otherpublications). These Policies and Procedures shall be designedto ensure that Synthes' funding and/or sponsorship complies withall applicable Federal health care program and FDArequirements;

p. compensation (including salaries and bonuses) for RelevantPromotional and Product Services Covered Persons who areSynthes Consultants. These Policies and Procedures shall bedesigned to ensure that financial incentives do not

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inappropriately motivate such individuals to engage in improperpromotion, sales, and marketing of Synthes' products; andq. disciplinary policies and procedures for violations ofSynthes'Policies and Procedures, including policies relating to Federalhealth care program and FDA requirements.

To the extent not already accomplished, within 30 days of their implementation,the relevant portions of the Policies and Procedures shall be made available to allindividuals whose job functions relate to those Policies and Procedures. Appropriate andknowledgeable staff shall be available to explain the Policies and Procedures.

At least annually (and more frequently, if appropriate), Synthes shall assess andupdate, as necessary, the Policies and Procedures. Within 30 days after the effective dateof any revisions, the relevant portions of any such revised Policies and Procedures shallbe made available to all individuals whose job functions relate to those Policies andProcedures.

C. Training and Education.

1. Genera! Training. Within 120 days after the Effective Date for U.S.-based Covered Persons and i 80 days after the Effective Date for Covered Persons basedoutside of the United States, Synthes shall provide at least two hours of General Trainingto each Covered Person. This training, at a minimum, shall explain Synthes':a. CIA requirements; andb. Synthes' Compliance Program (includiiigthe Code of Conductand the Policies and Procedures as they pertain to generalcompliance issues).

In addition, within 90 days after the Effective Date, Synthes shall notify allCovered Persons in writing or in electronic format of the fact that Synthes entered into aCIA and shall provide them with an explanation of Synthes' requirements and obligationsunder the CIA.


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New Covered Persons shall receive the General Training described above within30 days after becoming a Covered Person or within 120 days (or 180 days iftlle Covered

is later.Person is based outside the United States) after the Effective Date, whichever After receiving the initial General Training described above, each Covered Person shallreceive at least one hour of General Training in each subsequent Reporting Period.

2. Specjc Promotional and Product Services Training. Within i 20 daysafter the Effective Date for U.S.-based Covered Persons and 180 days after the Effectivethe United States, each Relevant Promotionalate for Covered Persons based outside of and Product Services Covered Person shan receive at least 4 hours of SpecificPromotional and Product Services Training in addition to the General Training requiredabove. This Specific Training shall include a discussion of:

a. all applicable Federal health care program and FDA requirementsand all Synthes Policies and Procedures relating to Promotional andProduct Services Related Functions;b. the personal obligation of each individual involved in Promotional and Product Services Related Functions to comply withall applicable Federal health care program and FDA requirementsand with Synthes Policies and Procedures;

c. the legal sanctions for violations of the Federal health careprogram and FDA requirements, the False Claims Act, and the Anti-kickback statute;d. examples of proper and improper practices related to Promotionaland Product Services Related Functions; and

e. the possible consequences to both Synthes and Relevant CoveredPromotional and Product Services Persons of failure to comply withFDA and Federal health care program requirements and withSynthes' own Policies and Procedures and the failure to report suchnoncompliance.New Relevant Promotional and Product Services Covered Persons shall receive

this training within 30 days after the beginning of their employment or becomingCorporaie Integrity AgreementSynthes, Inc.

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Relevant Promotional and Product Services Covered Persons, or within 120 days (or 180days if the Covered Person is based outside the United States) after the Effective Date,whichever is later. A Relevant Promotional and Product Sel'tices employee who is aSynthes Consultant shall not function independently in the field until after he or she hasreceived training on the topics set forth above. A Relevant Promotional and ProductServices Covered Person who is not a Synthes Consultant shall have his or her workreviewed by a Synthes employee who has completed the Specific Promotional andProduct Services Training, to the extent that the work relates to Promotional and ProductServices Functions, until such time as the person receives the training on the topics setforth above.

After receiving the initial Specific Promotional and Product Services Trainingdescribed in this Section, each Relevant Promotional and Product Services CoveredPerson shall receive at least 3 hours ofSpecfic Promotional and Product ServicesReporting Period.raining in each subsequent

3. Specific Clinical Investigation and Reporting Training. Within 120days after the Effective Date for U.S.-based Covered Persons and 180 days after theEffective Date for Covered Persons based outside of the U nIted States, each RelevantClinical Investigation Covered Person, IDE-Exempted Investigation Covered Person, andRelevant Reporting Covered Person shall receive at least 4 hours of Specific ClinicalInvestigation, IDE-Exempted Investigation, and Reporting Training in addition to theGeneral Training required above. This Specific Clinical Investigation, IDE-ExemptedInvestigation, and Repoliing Training shall include a discussion of:a. all applicable Federal health care program and FDA requirementsand all Synthes' Policies and Procedures relating to the CoveredFunctions addressed in this Section m.c.3;b. the personal obligation of each individual involved in CoveredFunctions addressed in this Section m.c.3 to comply with aUapplicable Federal health care program and FDA requirements andwith Synthes' Policies and Procedures, including the requirement tosubmit complete and accurate infOlmation to the FDA;

c. the legal sanctions for violations of the Federal health careprogram and FDA requirements;Corporate Integrity AgreementSynthes, Inc.

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d. examples of proper and improper practices related to each of theCovered Functions addressed in this Section lll.C.3; ande. the possible consequences to both Synthes and Relevant ClinicalInvestigation Covered Persons, IDE-Exempted Testing CoveredPersons, and Relevant Reporting Covered Persons of failure tocomply with FDA and Federal health care program requirements andwith Synthes' own Policies and Procedures and the failure to repol1such noncompliance.

New Relevant Clinical Investigation Covered Persons, new IDE-ExemptedInvestigation Covered Persons, and new Relevant Reporting Covered Persons shallreceive this training within 30 days after the beginning of their employment or becomingRelevant Clinical Investigation Covered Persons, IDE-Exempted Investigation CoveredPersons, or Relevant Reporting Covered Persons, or within 120 days (or ! 80 days if theCovered Person is based outside the United States) after the Effective Date, whichever islater. A Synthes employee who has completed the Specitc Clinical Investigation, IDE-Exempted Investigation, and Reporting Training shall review (a) a new Relevant ClinicalInvestigation Covered Person's work, to the extent that the work relates to ClinicalInvestigation Related Functions, until such time as the new Relevant ClinicalInvestigation Covered Person completes his or her Specific Training, (b) a new IDE-Exempted Investigation Covered Person's work, to the extent to the work relates to IDE-Exempted Investigation Related Functions, until such time as the new Relevant IDE-Exempted Investigation Covered Person completes his or her Specific Training, and (c) anew Relevant Reporting Covered Person's work, to the extent that the work relates toReporting Related Functions, until such time as the new Relevant Reporting CoveredPerson completes his or her Specific Training.

After receiving the initial Specific Clinical Investigation and Reporting Trainingdescribed in this Section, each Relevant Clinical Investigation Covered Person, IDE-Exempted Investigation Covered Person, and Relevant Reporting Covered Person shallreceive at least three hours of Specific Clinical Investigation and Reporting Training asdescribed in this Section m.c.3 in each subsequent Reporting Period.

3. Certification. Each individual who is required to attend training shall

certify, in writing, or in electronic form, if applicable, that he or she has received theCorporate Integrity AgreementSynihes, Inc.

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required training. The certification shall specify the type of training received and the datereceived. The Chief Compliance Officer ( or designee) shall retain the certifications,along with all course materials. These shall be made available to OIG, upon request.

4. Qualifications of Trainer. Persons providing the training shall beknowledgeable about the subject area of the training, including applicable Federal healthcare program and FDA requirements.

5. Update of Training. Synthes shall review the training annually, and,where appropriate, update the training to reflect changes in Federal health care programrequirements, FDA requirements, any issues discovered during any intemal audits or anyIRa Review, and any other relevant information.6. Computer-based Training. Synthes may provide the training requiredunder this CIA through appropriate computer-based training approaches. If Syntheschooses to provide computer-based training, it shall make available appropiiatelyqualified and knowledgeable staff or trainers to answer questions or provide additionalinformation to the individuals receiving such training.

D. Review Procedures.I. General Description.

a. Engagement of Independent Review Organization. Within 120days after the Effective Date, Synthes shall engage an entity (orentities), such as an accounting, auditing, or consulting firm

(hereinafter "Independent Review Organization" or "IRO"), topetform reviews to assist Synthes in assessing and evaluating itsCovered Functions. More specifically, the IRO(s) shall conductreviews that assess Synthes' systems, processes, policies,procedures, and practices relating to the Covered Functions(collectively, "IRa Review").The applicable requirements relating to the IRO are outlined inAppendix A to this CIA, which is incorporated by reference.Generally speaking, each IRO engaged by Synthes shall haveexpertise in applicable Federal health care program and FDA


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requirements as may be appropriate for the Review for which theIRO is retained. Each IRO shall assess, along with Synthes, whetherit can perform the engagement in a professionally independent andobjective fashion, as appropriate to the nature of the review, takinginto account any other business relationships or other engagementsthat may exist.

b. Frequency and Brief Description olReviews. As set forth morefully in Appendix B, the IRO Review shall consist of twocomponents - a Systems Review and a Transaction Review.

i. Systems Review. The Systems Review shall assess Synthes' systems, processes, policies, and procedures relatingto Covered Functions. If there are no material changes inSynthes' systems, processes, policies, and procedures relatingto any of the Covered Functions, the Systems Review shall beperformed in the first and fomth Reporting Periods. IfSynthes materially changes its systems, processes, policies,and procedures relating to any of the Covered Functions, theIRO shall perform a Systems Review for the Reporting Periodin which such changes were made in addition to conductingthe Systems Review for the first and fourth ReportingPeriods.ii. Transactions Review. The Transactions Review shall be performed annually and shall cover each of the fiveReporting Periods. The IRO(s) shall peiform all componentsof each annual Transactions Review.

c. Retention of Records. The IRO and Synthes shall retain and makeavailable to OlG, upon request, all work papers, supportingdocumentation, correspondence, and draft reports (those exchangedbetween the IRO and Synthes) related to the IRO Reviews.

2. iRO Review Reports. The IRO( s) shall prepare a report (or reports)based upon each IRO Review performed. The information and content to be included inthe report is described in Appendix B, which is incorporated by reference.

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3. Validation Review. In the event OIG has reason to believe that: (a) anyIRO Review fails to conform to the requirements of this CIA; or (b) the IRO' s findings orReview results are inaccurate, OIG may, at its sole discretion, conduct its own review todetermine whether the applicable IRO Review complied with the requirements of the CIAand/or the findings or Review results are inaccurate (Validation Review). Synthes shallpay for the reasonable cost of any such review performed by OIG or any of its designatedagents. Any Validation Review of Reports submitted as part of Synthes' final AnnualReport shall be initiated no later than one year after Synthes' final submission (asdescribed in Section II) is received by OlG.

Prior to initiating a Validation Review, OIG shall notify Synthes of itsintent to do so and provide a written explanation of why OYG believes such a review isnecessary. To resolve any concerns raised by OlG, Synthes may request a meeting withOIG to: (a) discuss the results of any Review submissions or findings; (b) present anyadditional information to clarify the results of the applicable Review or to correct thethe Review; and/or (c) propose alternatives to the proposed ValidationReview. Synthes agrees to provide any additional information as may be requested byinaccuracy of OlG under this Section IILD.3 in an expedited manner OIG wll attempt in good faith toresolve any Review issues with Synthes prior to conducting a Validation Review.However, the final detennination as to whether or not to proceed with a ValidationReview shall be made at the sole discretion of OYG.

4. Independence and Ohjectivity Certification. The IRO shall include in itsreport(s) to Synthes a certiflcation or sworn affidavit that it has evaluated its professional

the engagement, with regardto the applicable Review and that it has concluded that it is, in fact, independent andobjective.independence and objectivity, as appropriate to the nature of

E. Disclosure Program.

Prior to the Effective Date, Synthes established a Disclosure Program that includesa mechanism (~, a toll-free compliance telephone line) to enable individuals todisclose, to the Chief Compliance Officer or some other person who is not in thedisclosing individual's chain of command, any identified issues or questions associatedwith Synthes' policies, conduct, practices, or procedures with respect to a Federal healthcare program or FDA requirements believed by the individual to be a potential violationof criminal, civil, or administrative law. Synthes shall maintain the Disclosure Program


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described above during the term of this CIA and shall continue to appropriately publicizethe existence of the disclosure mechanism (~, via periodic emails to employees or byposting the information in prominent common areas).The Disclosure Program shall emphasize a nonretaliation policy, and shall includea reporting mechanism for anonymous communications for which appropriateconfidentiality shall be maintained. Upon receipt of a disclosure, the Chief Compliance

Officer (or designee) shall gather all relevant information from the disclosing individuaL.The Chief Compliance Officer (or designee) shall make a preliminary, good faith inquiryinto the allegations set forth in every disclosure to ensure that he or she has obtained allof the information necessary to determine whether a further review should be conducted.For any disclosure that is sufficiently specific so that it reasonably: (1) permits adetermination of the appropriateness of the alleged improper practice; and (2) provides anopportunity for taking corrective action, Synthes shall conduct an internal review of theproper follow-up is conducted.llegations set forth in the disclosure and ensure that

The Chief Compliance Officer (or designee) shall maintain a disclosure log, whichshall include a record and summaiy of each disclosure received (whether anonymous orthe respective internal reviews, and any corrective action taken inresponse to the internal reviews. The disclosure log shall be made available to OlG uponnot), the status of request.

F. Ineligible Persons.

1. Definitions. For purposes of this CIA:a. an "Ineligible Person" shall include an individual or entity who:

i. is currently excluded, debarred, suspended, or otherwiseineligible to participate in the Federal health care programs orin Federal procurement or nonprocurement programs; orii. has been convicted of a criminal offense that falls withinthe ambit of 42 U.S.c. 1320a-7(a), but has not yet beenexcluded, debarred, suspended, or otherwise declaredineligible.


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b. "Exclusion Lists" include:i. the HHS/OIG List of Excluded Individuals/Entities(available through the Internet at http://www.oig.hhs.gov);andii. the General Services Administratin's List of PartiesExcluded from Federal Programs (available through theInternet at http://www,epls.gov).

2. Screening Requirements. Synthes shall ensure that prospective andcurrent Covered Persons are not Ineligible Persons, by implementing the followingscreening requirements.

a. Synthes shall screen all prospective and current Covered Personsagainst the Exclusion Lists prior to engaging their services and, aspart of the hiring or contracting process, shall require such CoveredPersons to disclose whether they are Ineligible Persons.b. Synthes shall screen all Covered Persons against the ExclusionLists within 90 days after the Effective Date and on an annual basisthereafter.c. Synthes shall implement a policy requiring all Covered Persons todisclose immediately any debamient, exclusion, suspension, or otherevent that makes that person an Ineligible Person.

Nothing in this Section affects the responsibility of (or liability for) Synthesto (if applicable) refrain from billing Federal health care programs for items or servicesfurnished, ordered, or prescribed by an Ineligible Person, Synthes understands that itemsor services furnished by excluded persons are not payable by Federal health careprograms and that Synthes may be liable for overpayments (if applicable) and/or criminal,civil, and administrative sanctions for employing or contracting with an excluded personregardless of whether Synthes meets the requirements of Section rn.F.

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laws applicable to any Federal health care programand/or applicable to any FDA requirements for whichpenalties or exclusion may be authorized;

11. an adverse event that Synthes: (1) was required to report as an MDR and (2) failed to report to the FDAunder 21 U.S.C. 360i and 21 C.F.R. Part 803 within30 days; orIlL. the filing of a bankniptcy petition by Synthes.

A Reportable Event may be the result of an isolated event or a seiiesof occurrences.Reportable Events. If Synthes determines (after a. Reporting of reasonable opportunity to conduct an appropriate review orthe allegations) through any means that there is aReportable Event, Synthes shall notify OlG, in writing, within 30days after making the determination that the Reportable Event exists.

investigation of

The report to OIG shall include the following information:the Reportable Event, including

the relevant tcts, persons involved, and legal and Federalhealth care pr06'Tam and/of FDA authorities implicated;i. a complete description of

ii. a description of Synthes' actions taken to correct theReportable Event; andiii. any further steps Synthes plans to take to address theReportable Event and prevent it from recurring.iv. If the Repoiiable Event involves the filing of a bankruptcypetition, the feport to the OIG shall include documentation ofthe filing and a description of any Federal health careprogram authorities and/or FDA authorities implicated.


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i. Notification of Communications with FDA.

Within 30 days after the date of any written report, correspondence, orcommunication between Synthes and the FDA that materially discusses Synthes' or aCovered Person's actual or potentially unlawful or improper promotion of Synthes'products (including any improper dissemination of information about off-labelindications) or improper practices relating to Clinical Investigation Related Functions orIDE-Exempted Investigation Functions, Synthes shall provide a copy of the report,correspondence or communications to the OIG. Synthes shall also provide written noticeto the OIG within 30 days after the resolution of any matter disclosed in accordance withthe requirements set forth above, and it shall provide the OlG with a description of thefindings andJor results of the matter, if any.

J. Intemal Monitoring Program

To the extent not already accomplished, within 120 days after the Effective Date,Synthes shall establish an Internal Monitoring Program (IMP) to evaluate and monitorvarious aspects of Synthes' interactions with Heps and HCIs, including interactionsbetween Synthes Consultants and HCPs and HCIs. As set forth in more detail below, theIMP shall include two elements: i) Observations of Synthes personnel; and ii) ConsultantMonitoring Activities.1. Observations.

a. U.S. Compliance RevIew Program. Synthes' managers in the U.S. shaH conduct direct field observations (Compliance Reviews) of their non-executive,directly reporting employees, to include sales management and Synthes Consultants,marketing personnel and management, product development personnel and management,and sales support personnel to assess whether those employees know, understand, andcomply with the Policies and Procedures required by the CIA. Each Compliance Reviewshall consist of directly observing at least four hours of meetings between the reviewedemployees and HCPs and other representatives of HCIs, and two Compliance Reviewsshall be conducted per reviewed employee per year. At the completion of eachCompliance Review, the reviewing manager shall prepare a report which includes:

1) the identity of the reviewed employee;the manager/reviewer;) the identity of Corporate Integrity AgreementSynthes, Inc.

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Compliance Review or Field Visit (collectively "Observation"), Synthes shall investigatethe incident consistent with established Policies and Procedures for the handling ofinvestigations. As part of the fonnal investigation procedures, findings shall be made andall necessary and appropriate responsive action (including disciplinary action) andcorrective action shall be taken. The Chief Compliance Officer shall disclose ReportableEvents pursuant to Section III.H above, if applicable. The compliance department shallmaintain records of any compliance issues identified during an Observation and anycorrective action.

2. Consultant Monitoring Activities. To the extent that Synthes engages or reimburses an HCP to provide services or participate in training about Governmentan advisory board, as an attendee at a producttraining session, as a trainer, or as a participant in data-gathering exercises (includingReimbursed Products (e.g., as a member of

market preference evaluations)), such HCPs shall be referred to for purposes of this subsection as "Consultants". Synthes shall require all Consultants to enter writtenagreements describing the scope of work to be perfonned, the fees to be paid, expenses tobe reimbursed, and compliance obligations for the Consultants. Consultants shall be paidand expenses reimbursed according to a centrally managed, pre-set rate structure that isdetermined based on a fair-market value analysis conducted by Synthes.

Prior to the retention of Consultants, Synthes shall ensure that a business rationaleform has been completed to justify the retention of or payment to the Consultant. Thebusiness rationale form shall include an identification of the business need for theinformation to be provided by the Consultant and provide specific details about theconsulting arrangement (including, for example, information about the numbers andqualifications of the HCPs to be engaged, the agenda for any proposed advisory boardmeeting, and a description of the proposed work to be done and type of work product tobe generated by the Consultant).

To the extent not already accomplished, within iso days after the Effective Date,Synthes shaH establish a process to develop an annual Consultant budgeting plan thatidentifies the business needs for, and the estimated numbers of, various Consultantengagements and activities to occur during the year. The annual Consultant budgetingplan shall also identify the budgeted amounts to be spent on Consultant-related activities.Personnel from Synthes' legal department shall be involved in the review and approval ofsuch plans, including any subseqnent modification of an approved plan.

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Within 180 days after the Effective Date, Synthes shall also establish a process toobtain legal review of all business rationale forms associated with the retention of anyConsultant prior to the retention of the Consultant. The purpose of this legal review shallbe to ensure that Consultant arrangements and related events are used for legitimate andlawful purposes in accordance with applicable Federal health care program and FDArequirements, and that Consultant arrangements are consistent with the applicableapproved Consultant budgeting plan. Any deviations from the Consultant budgetingplans shall be documented in the business rational form (or elsewhere, as appropriate)and shall be considered as part of the legal review. To the extent not alreadyaccomplished, within 120 days after the Effective Date, Synthes shall amend its policiesto require the collection, assessment, and retention of work product generated byConsultants.

Within 120 days after the Effective Date, Synthes shall establish a ConsultantMonitoring Program through which it shall conduct audits (Consultant Program Audits)of the various types of consultant programs entered with HCPs. For the first ReportingPeriod, Synthes shall identify the 50 Consultants who received the largest amounts ofcompensation from Synthes during the year prior to the Reporting Period. Synthes shallaudit all programs conducted by the selected Consultants during the Repoiiing Period.For the second and subsequent Reporting Periods, 90 days prior to the end of theapplicable prior Reporting Period Synthes shall provide information to the OIG about thenumbers of each type of consulting program, the numbers of Consultants retained foreach type of program, and the aggregate amounts of funds expended for each type ofconsulting program during the Reporting Period. The OIG shall then select up to threetypes of programs to be audited and shall identifY the number of each type of program tobe audited by Synthes for each applicable Reporting Period. For the second andsubsequent Reporting Periods, the Consultant Monitoring Program shall reviewConsultant programs both on a risk-based targeting approach and on a random samplingapproach.

Personnel conducting the Consultant Program Audits shall review businessrationale forms, consultant contracts,. and materials relating to the prograni or work of theConsultant (including a verification that the work product resulting from any Consultant-related program or event or otherwise generated by the Consultant is consistent with thestated business need set forth on the business rationale form or elsewhere), in order toassess whether the progranis and arrangements were conducted in a marmer consistentwith Synthes' Policies and Procedures. Results from the Consultant Program Audits shall


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be compiled and reported to Synthes headquarters for review and remediation asappropriate. Potential violations of Synthes' Policies and Procedures shall be reported tothe Compliance Department for appropriate follow-up activity.

3. Reporting and Follow-up. Personnel conducting the Observations and Consultant Program Audits shall have access to all relevant records and information ofSynthes necessary to assess Synthes' interactions with HCPs and HCIs and to identifypotential or actual compliance violations. Results from the Observations and ConsultantProgram Audits shall be compiled and reported to the Chief Compliance Officer forreview and remediation as appropriate. Potential violations related to improperpromotion of a GoveITlment Reimbursed Product or potential violations of Federal healthcare program or FDA requirements shall be reported to the Compliance Department forappropriate follow-up activity.

in the event that a compliance issue, including but not limited to a potential off.label promotion or noncompliance with Synthes' legal requirements, compliance programrequirements or Policies and Procedures, is identified through the fMP, Synthes shallinvestigate the incident consistent with established Policies and Procedures for thehandling of investigations. As part of the formal investigation procedures, findings shallbe made and all necessary and appropriate responsive action (including disciplinaryaction) and corrective action shall be taken, including the disclosure of Reportable Eventspursuant to Section lItH above, as applicable.

Synthes shall include a summary of the IMP and its results as part of each AnnualReport. As part of each Annual Report, Synthes also shall provide the OlG with copiesof the Compliance Review Program or Field Visit Program reports for any instances inwhich it was determined that a Synthes employee engaged in improper conduct and adescription of the action(s) that Synthes took as a result of such determinations. Synthesshall make the reports for all other IMP activities available to the OIG upon request.

K. Notice to Health Care Providers and EntitiesWithin 90 days after the EfTective Date, Synthes shall send, by first class

mail, postage prepaid and retuITl receipt requested, a notice containing the language setforth below to the Chief Compliance Officer of each HCI that currently purchasesSynthes products. Synthes shall request that the Chief Compliance Officer distribute thenotice to all surgeons, purchasing staff, and other relevant persolUlel of such HCI. If theCorporate Integrity AgreementSynthes, InG.

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HCI does not have a Chief Compliance Officer, Synthes shall send the notice to the ChiefMedical Officer, Chief Executive Officer, or other officer or employee with equivalentresponsibility. This notice shall be dated and shall be signed by Synthes' Chief ExecutiveOfficer. The body of the letter shall state the following:As you may be aware, Synthes, Inc. recently entered into a global civil, criminal,and administrative settlement with the United States in connection with thepromotion and use of certain of its products.This letter provides you with additional information about the settlement, explainsSynthes' commitments going forward, and provides you with access to informationabout those commitments. In general terms, the Government alleged that Synthesengaged in unlawful conduct with regard to certain devices (calcium phosphate-based bone void fillers known as Norian XR and Norian SRS). To resolve thesematters, a subsidiary of Synthes (Norian, Inc.) pled guilty to felony andthe Federal Food, Drug & Cosmetic Actisdemeanor criminal violations of (FDCA). Synthes also pled guilty to misdemeanor criminal violations of theFDCA. Additionally, Synthes and Norian together agreed to pay more than $22million to the Federal Government. More information about this settlement maybe found at the following: http://us.synthes.com/compliance and ISynthes shall also inciude a link to the USAO, and OCL websites in the letter.)As part of the federal settlement, Synthes also entered into a five-year corporateintegrity agreement with the Office of Inspector General of the U.S. Department ofHealth and Human Services. The corporate integrity agreement is available athttp://oig.hhs.gov/fraud/ciaJindex.htmL. Under this agreement, Synthes agreed toundertake certain obligations designed to promote compliance with Federal healthcarecare program and FDA requirements. We also agreed to notify health providers about the settlement and inform them that they can report anyquestionable practices by Synthes' representatives to Synthes' ComplianceDepartment or the Food & Drug Administration (FDA).Please call or email Synthes at 1-888-353-0503 orhttps://\\!ww.incidentform.comiSynthes.jsp if you have questions about thesettlement referenced above or to report any instances in which you believe that aSynthes representative inappropiiately promoted a product or engaged in otherquestionable conduct. Alternatively, you may report any such instances to the

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FDA's Center for Devices and Radiological Health, Office of Compliance at 301796-5500. You should direct medical questions or concerns about the products toSynthes Customer Service Department at 1-800-273-9094.We appreciate your time and attention. Synthes is dedicated to ensuring that youhave access to the scientific and medical information you need to make well-informed decisions about whether Synthes products are right for your patients.The Chief Compliance Officer (or a designee) shall maintain a log of all calls and

messages received in response to the notice. The log shall include a record and summaryof each call and message received (whether anonymous or not), the status of the call ormessage, and any corrective action taken in response to the call or message. Thedisclosure log shall be made available to OIG upon request. As part of theImplementation Report and each Annual Report, Synthes shall provide to the OIG asummaiy of the calls and messages received.iv. CHANGES TO BUSINESS UNITS OR LOCATiONS

A. Change or Closure OfUiit or Location. In the event that, after the EffectiveDate, Synthes changes locations or closes a business unit or location related to any of theCovered Functions, Synthes shall notify OIG of this fact as soon as possible, but no laterthan within 30 days after the date of change or closure of the location.New Unit or Location. In the event that, after the

Effective Date, Synthes purchases or establishes a new business unit or location related toB. Purchase or Establishment of the Covered Functions, Synthes shall notify OIG no later than the date that thepurchase or establishment is publicly disclosed. This notification shaH include theany of the new business unit or location, phone number, fax number, Federal healthcare program provider or supplier number (if applicable), and the name and address of thecontractor that issued each number (if applicable). Each such new business unit orlocation and all Covered Persons at each such new business unit or location shall beaddress of

this CIA. Synthes may consult with the OfG asto the plan and timeline for implementing CIA requirements applicable to such newbusiness units or locations.subject to the applicable requirements of

Unit or Location. In the event that, after the Effective Date, Synthesproposes to sell any or all of its business units or locations that are subject to this CIA,

C. Sale of

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Synthes shall notify oro of the proposed sale no later than the date the sale is publiclydisclosed. This notification shall include a description of the business unit or location tobe sold, a brief description of the terms of the sale, and the name and contact informationof the prospective purchaser. This CIA shall be binding on the purchaser of suchbusiness unit or location, unless otherwise determined and agreed to in writing by theOIG.v. IMPLEMENTATION AND ANNUAL REPORTS

A. Implementation Report. Within 180 days after the Effective Date, Synthesshall submit a wiitten report to OiO summarizing the status of its implementation of therequirements of this CIA (Implementation Report). The Implementation Report shall, at aminimum, include:

I. the name, address, phone number, and position description of the ChiefCompliance Officer required by Section m.A.I, and a summary of other noncompliancejob responsibilities the Chief Compliance Officer may have, if any;

2. the names and positions of the members of the Compliance Committeerequired by Section m.A.2;

3. the names of the members of the Board of Directors referenced inSection III.A.3;

4. the names and positions of the Certifying Employees required bySection m.A.4;

5. a copy of Synthes' Code of C011duct required by Section III.B.I;6. the number of individuals required to complete the Code of Conduct

certification required by Section III.B.I, the percentage of individuals who havecompleted such certification, and an explanation of any exceptions (the documentationsupporting this information shall be available to OIG, upon request);7. a summary of all Policies and Procedures required by Section IILB.2 (a

copy of such Policies and Procedures shall be made available to the 010 upon request);

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8. the following information regarding each type of training required by Section III.C:

a. a description of such training, including a summary of the topics covered, the length of sessions, and a schedule of training sessions;andb. the number of individuals required to be trained, percentage ofindividuals actually trained, and an explanation of any exceptions.

A copy of all training materials and the documentation supporting this information shallbe available to OIG, upon request;9. the following information regarding the IRO(s): (a) identity, address,

and phone number; (b) a copy of the engagement letter; and (c) a summary anddescription of any and all current and prior engagements and agreements between Synthesand the IRO;

10. a certification from the IRO regarding its professional independenceand objectivity with respect to Synthes;

the Disclosure Program required by Section lII.E;L a description of 12. a description of the process by which Synthes fulfills the requirements

of Section III.F regarding Ineligible Persons;13. the name, title, and responsibilities of any person who is determined to

be an Ineligible Person under Section m.F; the actions taken in response to the screeningand removal obligations set forth in Section III.F;14. a certification by the Chief Compliance Officer that the notice required

by Section m.K was mailed to each HCl, the number of HCls that received a copy of thethe callsnotice, a sample copy of the notice required by Section m.K, and a summary of or messages received in response to the notice;15. a list of all of Synthes' U.S. locations (including locations and mailing

addresses); the corresponding name under which each location is doing business; theCorporate Integrity AgreementSynl.hcs, Inc

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corresponding phone numbers and fax numbers; each location's Federal health careprogram provider or supplier number(s) (if applicable), and the name and address of eachFederal health care program contractor to which Synthes currently submits claims (ifapplicable );

16. a description of Synthes' corporate structure, including identification ofany parent and sister companies, subsidiaries, and their respective lines of business;

17. a description of any transfers, divestitures, sales, and other businesstransactions involving Norian assets and operations which occurred within one year priorto the Effective Date or within 180 days after the .Effective Date; and

18. the certifications required by Section V.c.

B. Annual Reports. Synthes shall submit to oro alIDually a report with respect tothe status of, and findings regarding, Synthes' compliance activities for each of the fiveReporting Periods (Annual Report).Each Annual Report shall include, at a minimum:

1. an explanation of any change in the identity, position description, orother noncompliance job responsibilities of the Chief Compliance Officer and any changethe Compliance Committee, the Board of Directors, or the group ofn the membership ofCertifying Employees described in Sections m.A.2-4, and a copy of the ComplianceProgram Review Report described in Section IILA.3;

2. a copy of the Board of Directors' resolution required by Section HI.A.3;

3. a summary of any significant changes or amendments to the Policies andProcedures required by Section III.B and the reasons for such changes (~, change inapplicable requirements);

4. the number of individuals required to complete the Code of Conductcertification required by Section HI.B.I, the percentage of individuals who havecompleted such certification, and an explanation of any exceptions (the documentationsupporting this information shall be available to OIG, upon request);

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5. the following information regarding each type of training required by Section m.e:a. a description of such training, including a summary of the topics covered, the length of sessions, and a schedule of training sessions;andb. the number of individuals required to be trained, percentage ofindividuals actually trained, and an explanation of any exceptions.

A copy of all training materials and the documentation supporting this information shallbe available to OIG, upon request.

6. a complete copy of all reports prepared pursuant to Section III.D, alongthe IRO's engagement letter (if applicable);ith a copy of

7. Synthes' response and corrective action planes) related to any issuesraised by the reports prepared pursuant to Section m.D;

8. a summary and description of any and all current and prior engagementsand agreements between Synthes and the IRO, if different from what was submitted aspart of the Implementation Report;

9. a certification from the IRO regarding its professional independence andobjectivity with respect to Synthes;

10. a summary of the disclosures in the disclosure log required by Sectionm.E that relate to Federal health care programs or to Government Reimbursed Products;

11. any changes to the process by which Synthes fulfills the requirementsof Section III. F regarding lnelgible Persons;

12. the name, title, and responsibilities of any person who is detennined tobe an Ineligible Person under Section III.F; the actions taken by Synthes in response tothe screening and removal obligations set forth in Section IIL.F;

13. a summary describing any ongoing investigation or legal proceedingCorporate Integrity AgreementSyiithes, tne.

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required to have been reported pursuant to Section m.G. The summaiy shall include adescription of the allegation, the identity of the investigating or prosecuting agency, andthe status of such investigation or legal proceeding;14. a summary of Reportable Events (as defined in Section m. H) identified

during the Reporting Period and the status of any corrective and preventative actionrelating to all such Reportable Events;15. a summary describing any communication with the FDA required tohave been reported pursuant to Section IlL!. This summary shall include a description ofthe matter and the status of the matter;

16. all information required by Section IIIJ (relating to the InternalMonitoring Program);

17. a summary of the calls and messages recei ved in response to the noticerequired by Section m.K and the disposition of those calls and messages;18. a description of all changes to the most recently provided list ofSynthes' U.S. locations (including addresses) as required by Section V.A.IS; the

corresponding name under which each location is doing business; the correspondingphone numbers and fax numbers; each location's Federal health care program provider orsupplier number(s) (if applicable), and the name and address of each Federal health careprogram contractor to which Synthes currently submits claims (if applicable);

19. a description of any transfers, divestures, sales, and other business transactions involving Norian assets and operations which occurred during the applicableReporting Period; and

20. the certifications required by Section V.c.

The first Annual Report shall be received by orG no later than 60 days after theena of the first Repolting Period. Subsequent Annual Reports shall be received by oiGno later than the anniversary date of the due date of the first Annual Report.C. Certifications. The following certifications shall be included in the

Implementation Report and Annual Reports:

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1. Certifying Employees: in each Annual Report, Synthes shall include thecertifications of Certifying Employees as required by Section m.A.4;2. Chief Compliance Officer: In each Implementation Report and AnnualReport, Synthes shall include the following individual certification by the ChiefCompliance Officer:

a. he or she has reviewed the Report and has made reasonableinquiry regarding its content and believes that the information in the Report is accurateand tnithful;

b. to the best of his Of hef knowledge, except as otherwise desciibedin the applicable report, Synthes is in compliance with the Federal health care programand FDA requirements and the obligations of the CIA;

his or her knowledge, Synthes has complied with its. to the best of obligations under the Settlement Agreement: 1) not to resubmit to any Federal healthcare program payors any previously denied claims related to the Covered Conductaddressed in the Settlement Agreement, and not to appeal any such denials of claims; 2)not to charge to or otherwise seek payment from federal or state payors for unallowablecosts (as defined in the Settlement Agreement); and 3) to identify and adjust any pastcharges or claims for unallowable costs; and

d. Synthes': 1) Policies and Procedures as referenced in Section m.B.2 above; 2) templates for standardized contracts and other similar documents relatedto any of the Covered Functions; and 3) the training materials used for purposes ofSection m.c all have been reviewed by competent legal counsel and have been found tobe in compliance with all applicable Federal health care program and FDA requirements.In addition, Synthes' promotional materials and technique guides containing claims orinfoimation about Government Reimbursed Products and other materials and informationintended to be disseminated outside of Synthes within the United States by or on behalfof Synthes has been reviewed by competent regulatory, legal or other relevant personnelin accordance with applicable Policies and Procedures to ensure that legal, medical, andregulatory concerns have been addressed by Syl1thes and brought to the attention of theappropriate individuals when required, and that the materials and information whenfinally approved are in compliance with all applicable Federal health care program andFDA requirements. If the applicable legal requirements have not changed, after the initialCorporate Integrity AgreementSynthe~, Inc.

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review of the documents listed above, only material changes to the documents must bereviewed by competent legal counsel. The certification shall include a description of thedocument(s) reviewed and approximately when the review was completed. Thedocumentation supporting this certification shaH be available to 010, upon requestD. Designation of Information. Synthes shall clearly identity any portions of itssubmissions that it believes are trade secrets, or information that is commercial orfmancial and privileged or confidential, and therefore potentially exempt from disclosureunder the Freedom of Information Act (FOlA), 5 USC. 552. Synthes shall refrainfrom identitying any information as exempt from disclosure if that information does notmeet the criteria for exemption from disclosure under FOIA

VI. NOTIFICATIONS AND SUBMISSION OF REPORTS

Unless otherwise stated in writing after the Effective Date, all notifications andreports required under tills CIA shall be submitted to the following entities:OIG: Administrative and Civil Remedies BranchOffice of Counsel to the Inspector GeneralOffice of Inspector GeneralU.S. Department of Health and Human ServicesCohen Building, Room 5527

330 Independence Avenue, S. W.Washington, DC 2020 iTelephone: 202.619.2078Facsimile: 202.205.0604

Svnthes: Jeffrey B. MillerChief Compliance OfficerSynthes, Inc.1302 Wrights Lane EastWest Chester, P A 19380Telephone: 610.719.5241Facsimile: 610.719.5141

Unless otherwise specified, all notifications and reports required by this CIA may bemade by certified mail, overnight mail, hand deliveiy, or other means, provided that thereCorporate Integrity AgreementSynthes. Inc

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is proof that such notification was received. For purposes of this requirement, intemalfacsimile confinnation sheets do not constitute proof of receipt. Upon request by OlG,Synthes may be required to provide 010 with an electronic copy of each notification orreport required by this CIA in searchable portable document fonnat (pdt), either insteadof or in addition to, a paper copy.VB. OIG INSPECTION, AUDIT. AND REViEW RIGHTS

In addition to any other rights OTG may have by statute, regulation, or contract,OIG or its duly authorized representative(s) may examine or request copies ofSynthes'books, records, and other documents and supporting materials andJor conduct on-sitereviews of any of Synthes' locations for the purpose of verifying and evaluating: (a)this CIA; and (b) Synthes' compliance with theynthes' compliance with the terms of requirements of the Federal health care programs in which it participates and with allapplicable FDA requirements. The documentation described above shall be madeavailable by Synthes to OIG or its duly authorized representative(s) at all reasonabletimes for inspection, audit, or reproduction. Furthermore, for purposes of this provision,OIG or its duly authorized representative(s) may interview any of Synthes' employees,contractors, Of agents who consent to be interviewed at the individual's place of businessduring normal business hours or at such other place and time as may be mutually agreedupon between the individual and OIG. Synthes shall assist 010 or its duly authorizedrepresentative(s) in contacting and arranging interviews with such individuals upon OIG'srequest. Synthes' employees may elect to be intefviewed with or without a representativeof Synthes present.

VIII. DOCUMENT AND RECORD RETENTION Synthes shall maintain for inspection all docmnents and records relating toreimbursement from the Federal health care programs, or to compliance with this CIA,for six years (or longer if otherwise required by law) from the Effective Date.

IX. DISCLOSURES Consistent with HHS's FOlA procedures, set forth in 45 C.F.R. Part 5, OIG shallmake a reasonable effoit to notify Synthes prior to any release by orG of informationsubmitted by Synthes pursuant to its obligations under this CIA and identified uponsubmission by Synthes as trade secrets, or information that is commercial or financial and

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privileged or confidential, under the FOIA mles. With respect to such relcases, Synthcsshall have the rights set forth at 4S C.F.R. 5.6S(d).x. BREACH AND DEFAUL TPROVISIONS

Synthes is expected to funy and timely comply with all of its CIA obligations.A. Stipulated Penalties for Failure to Comply with Certain Obligations. As acontractual remedy, Synthes and OIG hereby agree that failure to comply with certain

obligations as set forth in this CiA may lead to the imposition of the following monetarypenalties (hereinafter referred to as "Stipulated Penalties") in accordance with thefollowing provisions.

1. A Stipulated Penalty of $2,500 (which shall begin to accme on the dayafter the date the obligation became due) for each day Synthes fails to establish orimplement any ofthe following obligations as described in Section lIT:a. a Chief Compliance Officer;b. a Compliance Committee;c. a resolution from the Board of Directors;d. a written Code of Conduct;e. written Policies and Procedures;f. the training of Covered Persons and Relevant Covered Persons;g. a Disclosure Program;h. Ineligible Persons screening and removal requirements;i. notification of Government investigations or legal proceedings;j. reporting of Reportable Events;

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k. notification of communications with FDA;L. an Internal Monitoring Program; andm. notification to HCls as required by Section m.K.

2. A Stipulated Penalty of $2,500 (which shall begin to accrue on the dayafter the date the obligation became due) for each day Synthes fails to engage an IRa, asrequired in Section m.D and Appendices A-B.3. A Stipulated Penalty of $2,500 (which shall begin to accrue on the day

after the date the obligation became due) for each day Synthes fails to submit theImplementation Report or the Annual Reports to OIG in accordance with therequirements of Section V by the deadlines for submission.4. A Stipulated Penalty of $2,500 (which shall begin to accrue on the dayafter the date the obligation became due) for each day Synthes fails to submit the annualIRa Review Report( s) in accordance with the requirements of Section m. D and

Appendices A-B.

5. A Stipulated Penalty of $1,500 for each day Synthes fails to grant accessas required in Section VII. (This Stipulated Penalty shall begin to accrue on the dateSynthes fails to grant access.)

6. A Stipulated Penalty of $5,000 for each false ceitification submitted byor on behalf of Synthes as part of its Implementation Report, Annual Report, additionaldocumentation to a report (as requested by the OIG), or otherwise required by this CIA.7. A Stipulated Penalty of $1,000 for each day Synthes fails to complyfully and adequately with any obligation of this CIA OlG shall provide notice toSynthes, stating the specific grounds for its determination that Synthes has failed to

comply fully and adequately with the CIA obligation(s) at issue and steps Synthes shalltake to comply with the CIA. (This Stipulated Penalty shall begin to accrue 10 days afterthe failure to comply.) A Stipulated Penalty asdescribed in this Subsection shall not be demanded for any violation for which OlG hasSynthes receives this notice from OIG of sought a Stipulated Penalty under Subsections 1-6 of this Section.

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the dueB. Timely Written Requests for Extensions. Synthes may,in advance of time to perform any act or fileate, submit a timely written fequest for an extension of any notification Of report required by this CIA. Notwithstanding any other provision inthis Section, if OIG grants the timely written request with respect to an act, notification,or report, Stipulated Penalties for failure to perform the act or tile the notification orreport shall not begin to accrue until one day after Synthes fails to meet the reviseddeadline set by OlG. Notwithstanding any other provision in this Section, if OIG deniessuch a timely written request, Stipulated Penalties for failure to perform the act or file thenotification or report shaH not begin to accrue until three business days after Synthesreceives OlG's written denial of such request or the original due date, whichever is later.A "timely written request" is defined as a request in writing received by OIG at least fivebusiness days prior to the date by which any act is due to be performed or anynotification or report is due to be filed.

C. Payment of Stipulated Penalties.1. Demand Letter. Upon a finding that Synthes has failed to comply with

the obligations described in Section X.A and after determining that StipulatedPenalties are appropriate, OIG shall notify Synthes of: (a) Synthes' failure to comply;any of and (b) OlG's exercise of its contractual right to demand payment of the StipulatedPenalties (this notification is referred to as the "Demand Letter").

2. Response to D

corporate integrity agreement between hhs oig and synthes, inc

Documents